The passage of the defense spending portion of the Omnibus bill ultimately means there will be increased demand for U.S. steel and aluminum within new defense equipment. The contracts within the procurement process will predictably require the use of U.S. parts.

Add the increase in defense spending with the pending global tariffs on steel imports, and the environment is created for foreign investment in domestic steel and metal manufacturing…. Then add into the mix the geopolitical economic relationship developed between India’s Prime Minister Modi and President Trump… And you discover the backdrop for this announcement from India owned JSW Steel:

(Reuters) – India’s JSW Steel Ltd said on Monday it would spend $500 million to build out its U.S. operations in Texas, amid heightened global trade tensions following U.S President Donald Trump’s decision to pursue steep import tariffs.

The company has signed an agreement with the Texas governor’s office, under which the governor has approved a grant worth $3.4 million to the company’s unit, the steelmaker said in a statement here.

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Perhaps as early as this week we should anticipate hearing about completion a significant trade agreement with South Korea.  The deal is known as “KORUS” (KOR+U.S.), and has been in negotiations for over a year.

Part of the recent agreement within the auto-sector of the deal, between Moon Jae-in and President Donald Trump, via Lighthizer and Ross, is an exemption of U.S. steel tariffs for South Korea in exchange for a doubling of U.S. auto exports; from 25,000 to 50,000 American made cars, per U.S. automaker, per year.  (link)

The results within KORUS exhibit the intended outcome of the global tariff proposal from President Trump as leverage to enhance the administration policy of reciprocity.  The world is taking notice, and China is now beginning to signal their understanding of President Trump leading the international discussion of reciprocal trade.

The unspoken background is that all nations, who have acquiesced to the overwhelming demands of China’s trade position, are now beginning to reassess the value of President Trump confronting the equation head-on.  Ultimately it is beginning to sink-in that all nations can benefit from correcting a trade imbalance within their own position.  In essence, U.S. President Trump is moving the entire global trade dynamic.

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Author of “The Coming Collapse of China”, Gordon Chang, discusses the effect of President Trump’s tariffs on China and the epic battle ahead.  Last night China announced their feeble retaliatory actions – SEE HERE.  A professionally nervous Maria Bartiromo, frames a series of questions from the perspective of Wall Street.

Fortunately Gordon Chang understands the Red Dragon, and more importantly understands Chinese Chairman Xi Jinping’s geopolitical goals through economic conquest. Mr. Chang is one of the few people who appear regularly in media and know the truth behind the Panda Mask.

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People often talk about the ‘strength’ of China’s economic model; and indeed within a specific part of their economy -manufacturing- they do have economic strength.

However, the underlying critical architecture of the Chinese economic model is structurally flawed and President Trump with his current economic team understand the weakness better than all international adversaries.

China is a central planning economy.  Meaning it never was an outcropping of natural economic conditions.  China was/is controlled as a communist style central-planning government; As such, it is important to reference the basic structural reality that China’s economy was created from the top down.

This construct of government creation is a key big picture distinction that sets the backdrop to understand how weak the economy really is.

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Commerce Secretary Wilbur Ross appears with Bloomberg Inc. to discuss the ongoing U.S. trade initiatives and the need for immediate and urgent trade reciprocity.

Within the discussion Secretary Ross talks about the current targeted tariff proposal, and why intellectual property theft by Chinese state-run companies poses a clear threat to U.S. economic growth and national security interests.

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From the Office of the U.S.T.R. – Washington, DC – Today President Trump announced his decisions on the actions the Administration will take in response to China’s unfair trade practices covered in the USTR Section 301 investigation of China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation. U.S. Trade Representative Robert Lighthizer initiated the investigation in August 2017 at the direction of President Trump.

The President has instructed that the appropriate response to China’s harmful acts, policies and practices should include three separate actions.

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Leo Gerard, the President of the United Steelworkers Union, talks to a very frustrated Chuck Todd about the effect of President Trump’s new tariffs and his appreciation therein.

Chuck Todd has all his Media Matters talking points prepared to outline his narrative; however, unfortunately for the toad, he came up against a very knowledgeable union leader with a solid grasp of the details and important specifics.  WATCH:

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As you can see from President Leo Gerard’s comments he well understands the value of Commerce Secretary Wilbur Ross, U.S. Trade Ambassador Robert Lighthizer and administration trade strategist Peter Navarro. The next phase of MAGAnomic Main Street trade initiatives involves global “trade reciprocity” advancement.

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Commerce Secretary Wilbur Ross appears for an interview with Trish Regan immediately after President Trump signed the Presidential Proclamation to advance Steel and Aluminum tariffs to protect and expand American industry. [DEEP DIVE]

Ms. Regan is one of the financial business analysts who have slowly evolved away from the insufferable Wall Street/U.S. Chamber of Commerce ‘globalist’ viewpoints, which was/is entirely built upon a false premise.  Thankfully Ms. Regan joins the ranks of economic patriots Charles Payne and Lou Dobbs.  We’ll keep working on Maria Bartiromo.

In this interview Secretary Ross elevates the discussion beyond just Steel and Aluminum and begins to expand -and emphasize- the perimeter of an entirely new American approach toward trade, “reciprocity“.  Indeed for the very first time in this interview Secretary Ross gives a preview into what will follow and how ‘reciprocity’ will be applied.

“President Trump is taking action today to protect both our national security and industries critical to our economy. The President’s decision regarding the steel and aluminum Section 232 reports are the result of a long and well-thought-out process led by the Commerce Department. Once again, President Trump is keeping his promises and standing up for American families, American businesses, and American workers.”  ~ Commerce Secretary Wilbur Ross

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Important stuff in this ‘straight talk’ interview.  Buckets of ‘breaking’ stuff to unpack.

First, per Trade Adviser Peter Navarro, the Steel and Aluminum tariffs will be announced tomorrow.  Second, Mexico and Canada will be given an exemption from those tariffs while NAFTA is being renegotiated.  WATCH:

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The exemption will give U.S. Trade Representative Robert Lighthizer increased leverage in his efforts to close the NAFTA loophole.  Closing the NAFTA “fatal flaw” is the essential “Option 1” that we have discussed previously several times.  It would be against the interests of Canada and Mexico to ever agree to close the loophole.  However, the steel and aluminum tariffs add a bit of financial incentive not previously in the equation.

It is still highly doubtful the amount of money in the steel and aluminum tariff aspect is close to enough to get Canada and Mexico to agree to close the backdoor loophole.  However, any amount is more than was there before…. so the possibility of “option 1” increases a smidge.

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Commerce Secretary Wilbur Ross talks about the importance of trade “reciprocity”.  As Wilburine outlines phase-2 MAGAnomics is only just beginning the reciprocity discussion.

Additionally, Secretary Ross talks about the issues with Chinese steel trans-shipment and the reason for Steel and Aluminum tariffs to be global in order to address China’s use of proxy nation states to continue dumping.   In this interview Ross begins to outline the fine points behind the pending 2018 trade negotiations. It is going to take a lot of repeated effort to awaken the larger U.S. electorate to the issues.

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Ya know, it’s increasingly funny to watch the Wall Street crowd going bananas simply because POTUS Trump does exactly what POTUS Trump said he was going to do.  I mean it’s not like the administration has been hiding the trade policy plans and objectives for the past year; yet, the financial class acts shocked, SHOCKED, when it actually happens.

Cue the audio visual demonstration….. Was anyone paying attention in January at the Davos World Economic Forum when Commerce Secretary Ross said exactly what the administration was going to do in the coming months?  ….Apparently not.

Against the backdrop of current financial and corporate media running around like blindfolded zombies with forks in their eyes – hysterically bumping into walls, it might be worthwhile to revisit Commerce Secretary Wilbur Ross’s purposeful remarks at Davos:

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Twitter Thread HERE to Expand Full Dynamic

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Commerce Secretary Wilbur Ross appears on Sunday Morning Futures with Maria Bartiromo to talk trade and tariffs amid the apoplectic drum-beating from the Wall Street crowd and U.S. Chamber of Commerce.

Secretary Ross explains the use of Trade Section 232 for national security. The U.S. capability to produce steel and aluminum is a vital interest to national security. The World Trade Organization (WTO), a collective enterprise of multinational corporations, is angered by the use of section 232 because it works around their ability to file complaints.

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The essential point to drive home is that for the past 30+ years U.S. trade policy has been driven by Wall Street and financial corporate benefactors to the detriment of the U.S. middle class and a manufacturing economy.  It is not necessary to argue the outcome, we can all clearly see it.  The Trump objective is to restore a balanced U.S. economy, stop the exploitative export of American wealth, and stabilize our own middle-class.

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